DOL Launches Enron 401(k) Investigation

December 6, 2001 (PLANSPONSOR.com) - The US Labor
Department says it plans to weigh in with its own
investigation of the Enron case - focusing on questions about
the handling of workers' retirement benefit plans.

Enron blocked employee transfers for several weeks
during a recordkeeper conversion, according to
reports. Unfortunately for workers, that freeze came
during a period where questions about the firm’s accounting
practices and a restatement of prior year earnings set off
a dramatic plunge in the firm’s stock price.

The firm filed for Chapter 11 bankruptcy protection last
Sunday.

The Labor Department said many Enron employees lost 70%
to 90% of their retirement assets after the company said it
would restate its earnings. The department said it is
reviewing:

– Enron’s employee benefits plans
– the rules governing them and
– the steps the company took shortly before its
collapse to keep employees from making transactions with
their 401(k) plan assets

“Enron’s employees have gotten the short end of the
stick in the sudden collapse of this company, and we are
committed to doing everything we can to help them,” Labor
Secretary Elaine Chao said in a statement.